Digital transactions not short-term substitute for cash: PM Modi

On the eve of the expiry of the deadline to deposit demonetised currency in banks, Prime Minister Narendra Modi urged citizens not to regard digital transactions as a short-term substitute for cash payments.

"Digital transactions should not be viewed as a short-term substitute for cash payments," Modi told India Today magazine in an interview.

"Digital transactions facilitate formal accounting and sizing of the economy," he said.

"They also deliver greater tax compliance," he added.

On November 8, Modi had announced that Rs 1,000 and Rs 500 notes were no longer legal tender, saying the move was to combat corruption, counterfeit currency and terror financing.

Complementing the demonetisation process, the government announced a series of measures to promote digital payments to move towards an economy making less cash transactions.

"Digital payment is a way of cleaning the economy in the long-run," the Prime Minister said.